Just like other countries, the Singapore Government also provides several incentives to promote entrepreneurship in the country. The Inland Revenue Authority of Singapore (IRAS) which is the tax authority of Singapore, has implemented tax reduction schemes targeted at businesses, especially SME or startups in Singapore.
Below is a list of the various corporate tax incentives that you as a business owner may be eligible for.
For Manufacturing and Services Industry
1. Pioneer Certificate Incentive (PC)
This incentive is available to businesses and companies who can demonstrate that their expertise is significantly more advanced than what is already available in Singapore. The corporate tax incentive is a concessionary tax rate of 5% for up to five years.
2. Development and Expansion Incentive (DEI)
If you can demonstrate that your company’s expansion and development would boost Singapore’s economy, you can qualify for the Development and Expansion Incentive. For the next ten years, you will be subject to a 5% tax rate.
For Banks and Insurers
1. Finance and Treasury Centre (FTC) Incentive
The Finance & Treasury Centre (FTC) incentive is for businesses that provide services in corporate finance advisory, foreign exchange, management of interest rate, etc. The relief offered under this category is a reduced corporate tax rate of 8% on income. You will need to apply for this incentive at the Singapore Economic Development Board.
2. Financial Sector Incentive (FSI) Scheme
The Financial Sector Incentive (FSI) Scheme is available for financial institutions that are licensed, and that performs a mix of corporate and business functions. These are eligible to receive several concessionary tax rates for headquarter services, loans, and fund management. Applications are sent to the Monetary Authority of Singapore.
3. Insurance Business Development (IBD) Scheme
The Insurance Business Development (IBD) Scheme is for insurance companies and businesses that are licensed and that offer services in claims handling, risk consulting, etc. Those who qualify will receive a concessionary tax rate of up to 10%. Applications are also sent to the Monetary Authority of Singapore.
Want to learn more the other Singapore incentives to businesses? Check out this Singapore Company Incorporation blog.
